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    Home»Mortgage Loans»FHA Program Enhancements Help Your Family Remain in Your Home
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    FHA Program Enhancements Help Your Family Remain in Your Home

    Tech AdminBy Tech AdminJuly 24, 2016Updated:October 27, 2016No Comments2 Mins Read
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    FHA Program Enhancements Helps Your Family Remain in Your Home

    U.S. Department of Housing and Urban Development (HUD) just recently announced enhancements to its Distressed Asset Stabilization Program (DASP). One of the main objectives of this program is to help families remain in their homes and keep their properties from foreclosure.

    The updated program offers greater opportunity for non-government agencies as well as local and other government entities to encourage them to participate in the DASP.

    The program improvement dictates that all FHA loss mitigation efforts must be exhausted before selling the loans through the DASP.

    Also, investors are prohibited from abandoning low-value properties in neighborhoods with high foreclosure cases. This is to prevent the reduction of value to homes.

    Here is the list of the most recent enhancements of the DASP:

    • Principal Reduction/Capital Arrearage Forgiveness – When evaluating borrowers for loan modification, investors must consider principal forgiveness as the first option.
    • Payment Shock Protection – Consistent with the Home Affordable Modification Program (HAMP), interest rates are limited to an increase of no more than 1% after the 5-year fixed-rate period.
    • Walk-Away Prohibition –  If a single-family mortgage is under DASP, purchasers are prohibited from abandoning properties that have lower values. This is to prevent neighborhood blight.
    • Alternative Bidding for Non-Profit Buyers – Non-government agencies and government entities are encouraged to participate in the DASP. Qualified NGOs are allowed to bid on up to 5% of the National Pool of notes and pay the reserved price.

    More program improvements include streamlined direct sales to interested government entities and enhancing FHA’s efforts to identify and offer loans in predetermined distressed areas to non-profits, NGOs, and local governments.

    If you have questions about your FHA loan and how these recent program enhancement can help you, talk to a lender now.

    »Click Here to get Matched With a Lender»

    DASP Department of Housing and Urban Development Distressed Asset Stabilization Program FHA HUD
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